Janus Capital executives thought about selling the Denver investment manager to Franklin Resources last year and could once again entertain that prospect if the firm's stock continues to drop, Diya Gullapalli reports in Tuesday's Wall Street Journal Fund Track column.

The firm's stock has fallen close to 80 percent this year. On Monday, the stock closed at $7.47, up 16 percent amid the market rally.

Janus CEO Gary Black's efforts to revamp the firm -- including cutting pay -- have triggered infighting and massive turnover at Janus. Black has also encountered criticism for not moving to Denver, instead preferring to commute from his home in New Jersey every week, Gullapalli writes.

Since last year, several Janus portfolio managers headed out the door, along with the company's general counsel, chief financial officer, chief operating officer and head of institutional sales.

"If some folks don't agree with some of the decisions we've made, they're entitled to that," Black told Gullapalli. "We feel we've made the right business decisions."

In the article, Gullapalli notes that the flagship Janus Twenty was in the first percentile among large growth funds in 2007, with Scott Schoelzel at the helm. This year, the fund is in the 61st percentile under Ron Sachs, a company veteran who took the reins of the fund in January. Gullapalli also points to funds such as the Janus Fund, Janus Orion Fund and Janus Enterprise Fund, which are "sinking faster than peers" after undergoing portfolio management changes.

Black, however, doesn't think turnover has negatively affected performance.

"I'd argue the investment team has never been more cohesive than today," he told Gullapalli. For Black, the issue is "research mistakes," such as failing to determine how the credit crunch would deepen this year. 

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